The Impact of Hazardous Industrial Facilities on Housing Prices: A Comparison of Parametric and Semiparametric Hedonic Price Models

Celine Grislain-Letremy and A. Katossky
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A. Katossky: Insee

Documents de Travail de l'Insee - INSEE Working Papers from Institut National de la Statistique et des Etudes Economiques

Abstract: Households willingness to pay for prevention against industrial risks can be revealed by real estate markets. With highly detailed microdata, we study housing prices in the vicinity of hazardous industries located near three important French cities (Bordeaux, Dunkirk and Rouen). We show that the impact of hazardous plants on housing values strongly differs among the three studied areas, even if they all surround chemical and petrochemical industries. We compare the results from standard parametric hedonic property models and from a more flexible, semiparametric hedonic property model. We show that the parametric model may structurally lead to an important bias in the estimated value of the impact of hazardous plants on housing values and in its variations with respect to distance to the plants.

Keywords: hedonic analysis; locally-weighted regression; urban housing markets; industrial risk (search for similar items in EconPapers)
JEL-codes: C21 Q51 R21 R52 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (18)

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https://www.bnsp.insee.fr/ark:/12148/bc6p06zr78g/f1.pdf Document de travail de la DESE numéro G2014-05 (application/pdf)

Related works:
Journal Article: The impact of hazardous industrial facilities on housing prices: A comparison of parametric and semiparametric hedonic price models (2014)
Working Paper: The Impact of Hazardous Industrial Facilities on Housing Prices: A Comparison of Parametric and Semiparametric Hedonic Price Models (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:nse:doctra:g2014-05

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